Matrix Blog

Archive for February, 2012

Change is Constant: 100 Years of New York Real Estate

February 7, 2012 | 11:28 am | delogo | Articles |


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Last fall Prudential Douglas Elliman turned 100 years old and they asked me to write an article for their Elliman magazine. If you’ve been living in a cave, I’ve been writing their housing market report series since 1994.

What started as a simple project morphed into a fun, albeit gigantic, research project. I learned a lot about the evolution of the Manhattan housing market, largely through the amazing incredible New York Times archives. This was right about the time of my web site revision and semi-necessary hiatus so I am cleaning out my desk of posts I have been itching to write so please indulge me.

The article I wrote for Douglas Elliman was beautifully presented by their marketing department and prominently inserted in their Elliman magazine (and iPad app!).

Diane Cardwell of the New York Times in her “The Appraisal” (an incredible column name BTW) penned a great piece: In an Earlier Time of Boom and Bust, Rentals Also Gained Favor that originated from my article and zeroed in on the 1920s and 1930s to draw a comparison to the current market.

I have the feeling my project is going to morph into something bigger – it’s just too interesting (to me). A few things I learned about the Manhattan market over this period:

  • Douglas Elliman published the first market study in 1927 [heh, heh] not counting other marketing materials written before WWI)
  • Real estate media coverage in the first half of the century was social scene fodder (same as today) but with extensive and excessive personal details presented on tenants, buyers and sellers yet housing prices and rents were rarely presented in public.
  • Manhattan made a rapid transition from single family to luxury apartment rentals and eventually co-ops.
  • Housing prices and rents by mid century weren’t that much different than the beginning of the century.
  • Manhattan’s population peaked at 2.3M around WWI.
  • Wall Street in the 1920′s was seen as the driver of the real estate market.
  • Federal and state credit fixes in the late 1930′s help bail out the housing market.



• Change Is The Constant In A Century of New York City Real Estate – pdf [Miller Samuel]
• My Theory of Negative Milestones [Matrix]

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[Bigger Than A Phone Book] Manhattan Decade 2002-2011 Report (Co-ops+Condos)

February 7, 2012 | 11:19 am | delogo | Reports |

We released our report on the Manhattan co-op/condo market for 2002-2011 this morning. This report is 60 pages of data bliss as far as I’m concerned. More than 100,000 sales collected, cleaned, sliced, whipped chopped and pureed.

Absolutely love the cover photo the graphics people selected.

I’ve been authoring this market report series for Douglas Elliman since 1994.

Co-ops and condos consistently account for roughly 98% of Manhattan residential sales. Manhattan is primarily a rental market and single family sales are a very specific high end niche market.

Here’s an excerpt from the report:

The number of sales remained above the 10,000 sale threshold for the second consecutive year and for the fourth time in the decade. There were 10,161 sales in 2011, the third highest total of the decade. The total was 1% above the prior year total of 10,060, but 24.3% below the 2007 housing boom peak of 13,430. The weakest period of sales activity for the decade was in 2009, the year after the “Lehman tipping point” in late 2008, when the credit crunch and low consumer confidence stifled sales activity. The second weakest period surprisingly occurred in 2005, after affordability fell sharply with the highest pace of price appreciation in the decade. The last two years of the decade saw the most sales of 3-bedroom and 4-bedroom apartments as the market benefited from unstable global economic conditions. Foreign buyers and the wealthy continued to seek financial refuge in the high-end Manhattan housing market.

The custom data tables are updated and ready for you to play with. The chart section on the new site remains a work in progress.



The Elliman Report: Manhattan Decade 2002-2011 (Co-ops+Condos) [Prudential Douglas Elliman]

The Elliman Report: Manhattan Decade 2002-2011 (Co-ops+Condos [Miller Samuel]

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Buying Manhattan Apartments with Gold

February 7, 2012 | 11:14 am | nytlogo | Charts |

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Last year I got an email from a Matrix reader, Ben Tanen, a former VC now running his own investment partnership that invests in public companies, with an interesting take on the buying power of gold as it relates to Manhattan apartments.

Like many things in my life, I let this “nugget” (sorry) slip through the cracks last year. He recently updated it with our new numbers in the recent release and it’s quite compelling.

The value of gold has risen sharply in recent years during the wobbling of the global financial markets – investors see precious metals like gold as a way of preserving purchasing power over the long run. In fact, in 2011, gold had more purchasing power relative to Manhattan real estate than at anytime during the past 22 years (the limit of our publicly released data).

It would take 908 ounces of gold to purchase the average Manhattan apartment versus the 1996 low point of 1,030 ounces, a point where many think our asset bubble problems began (stocks, then housing).